Earnings Growth and Employment Creation: An Assessment of World Bank Support in Three Middle-Income Countries
The Bank has identified five policy areas that affect employment: macroeconomic conditions, investment climate, labor regulations, education, and social protection. This study uses this MILES framework, as it is known, to assess the Bank's assistance to three middle-income countries (MICs)—... Full Description »
The Bank has identified five policy areas that affect employment: macroeconomic conditions, investment climate, labor regulations, education, and social protection. This study uses this MILES framework, as it is known, to assess the Bank's assistance to three middle-income countries (MICs)—Colombia, Tunisia, and Turkey—during 1998-2007. The assessment considers the impact of the Bank on policies, and the impact of these policies on employment and earnings. The comparative analysis of a set of country programs is an approach to drawing lessons that may be useful in other situations, such as the current global financial crisis, where numerous MICs face similar employment creation and earnings growth challenges.
The three countries had very different experiences during the evaluation period. Colombia went through a deep recession during 1998-99 that increased its unemployment rate to unprecedented levels; Tunisia experienced a high unemployment rate that resisted efforts to reduce it for decades; and Turkey also saw a sharp rise in unemployment as it implemented structural reforms to stabilize its economy after many years of double-digit inflation, and its employment ratio continued its long-term decline. This evaluation found that employment-related outcomes in the three countries were mixed, with notable progress in economic growth, earnings, and poverty reduction, but not in the employment-to-population ratio or the unemployment rate. Second, Bank program objectives in the three countries focused more on MILES components than on employment itself. Third, Bank support in the three countries achieved differential progress in the individual MILES components, with the most progress on macroeconomic stabilization, followed in approximate order by progress on the investment climate, education, social protection, and labor taxation and regulations. IEG rates the outcome of the Bank program in Colombia with respect to progress in employment and earnings growth as moderately satisfactory. The outcome of the Bank program in Tunisia relating to employment and earnings growth is rated satisfactory. The outcome of the Bank program in Turkey with respect to employment and earnings is rated moderately satisfactory.
Content Type : Reports , Country : Colombia, Tunisia, Turkey
February 23, 2011